Alistair Darling: An independent Scotland will weaken its strength in Brussels

As Europe lurches from one crisis to the next, the former chancellor Alistair Darling has argued that an independent Scotland would significantly reduce its strength in Brussels.

Warning that a Scotland attempting to go it alone ran the risk of “having things inflicted” on it by the likes of Germany and France, Darling – who will next week launch the campaign to keep Scotland in the Union – told a conference organised by the Scotsman newspaper:

“Who runs Europe? It is not run by small countries. It is run by large countries. You may think that is wrong but that is actually how it works.

“But we do have influence in Europe as part of the UK, in particular on the big issues, but also on the irritants that affect business in regulation and so on.

“It does actually help if you have got sufficient clout to say: ‘No, we don’t actually want that.”

However, it was the SNP’s continued pledge to retrain sterling and the Bank of England as its central bank that caused most interest.

With the Treasury having already made clear that Scotland would not, as the nationalists have argued, have any say over monetary policy if it retained the pound, Darling went on to argue that it would create an absurd situation whereby Scotland would be regulated by legislation of another country.

“That means, of course, that they will be regulated by legislation that was passed in the rest of the UK over which an independent Scotland would have no influence.

“If you remain part of the EU, of which I think the answer is unequivocally yes, the EU directives at the present time require you, if you are a member state, to have bank regulation because that is part of the euro-wide system at the moment.”

He continued:

“Whether you like it or not, especially for our biggest institutions that trade not just south of the border but trade throughout the world, the first thing that people ask is: ‘Who regulates you? Who is in charge? Who stands behind you?’

“That is a very important consideration in relation to decisions that are made in the future about what these companies do.”

His views were echoed by a former adviser to Alex Salmond.

In his contribution, Professor John Key, formerly a member of the first minister’s Council of Economic Advisers, addressed the problem of the strings that would be attached to retaining sterling, observing:

“One would find that the terms would so undermine independence that one would not wish to pursue that particular outcome.”

Turning his attention to the impact on the Scottish economy in the likely five year period between Scotland saying yes to independence in 2014 and it actually becoming a sovereign state, Kay warned:

“There will be a fairly lengthy period of uncertainty and we have to ask ourselves how large these costs will be or whether the benefits will be worth it.”

In response to the debate, rather than seeking to address the fundamental questions over his own party’s policies, finance secretary John Swinney opted to play the blame game, arguing that Westminster had failed to develop the potential of Scotland as a nation.

“Over the past thirty years up to the financial crisis, growth in Scotland averaged 2.1 per cent against 2.7 per cent in other comparable small EU countries and the wealth we have delivered for the UK has not been shared.

“Such figures are all the more frustrating as despite a period of unprecedented growth in the global economy, the previous UK government missed a once in a lifetime opportunity to deliver a real improvement in prosperity and social equality. Instead, growth was squandered on an unsustainable boom that benefitted the few rather than the many.”

In his assessment of the event, Eddie Barnes, Political Editor of The Scotsman, wrote:

“We have Donald Rumsfeld to thank for the distinction between “known unknowns” and “unknown unknowns”. Yesterday, his famous distinction of the bounds of knowledge entered the lexicon in the count-down to Scotland’s independence referendum.

“At a conference organised by The Scotsman newspaper, Rumsfeld’s theory was introduced by Owen Kelly, the chief executive of Scottish Financial Enterprise. Addressing the coming vote from the position as a neutral observer, Mr Kelly noted that one of the problems with the run-up so far was the difficulty in distinguishing between fact and assertion.”

He continued:

“The trouble for the SNP is that suck-it-and-see is not a very auspicious offer to people, especially when they’re in the middle of an economic storm, with another poll yesterday showing a thumbs down.

“Consequently, the party has attempted to ease those concerns by asserting how they see it working – with the plan to keep the pound and a monetary union with the UK chief among them. But then, as these claims also come under scrutiny, the risk is that they come across as pushing something that isn’t theirs to offer.

“On the Labour side of the fence, senior figures muse mischievously that what they’d really fear right now is a figure like former SNP MP Jim Sillars telling people up-front and square that all the Rumsfeldian unknowns in the world are worth it, so long as sovereignty is achieved. Instead, they believe the attempt to ease the fear of the unknown is pushing the independence cause on the defensive.”

Mike B

To me independence means one major advantage above all others and that is why I will never have to live under a Tory government again. The Scottish Labour Party should wake up and help to build a Social Democratic independent Scotland.

Anonymous

Economic comment would, howeve, be a bit more convinving if it did not come from Darling.
Scaremongering is no0t going to help the ‘no’ campaign over the long run – it may even be counter-productive. In anu case, Darling’s comments on influence in Europe are hollow. Of course the big European countries have most influence, but the reality is that with sic MSPs and governments (Tory and Labour) that obviously need to put the biggest concentration of the electorate first, Scotland has no influence in Europem at all – hence the disastrous settlements on fishing, lamb and whisky for example. Thse are not ‘big-ticket- items for the UK as a whole, but they are significant in Scottish terms. They may be a ‘price worth paying; for the UK, but it is – at best – disingenuous for Darling to suggest that Scottish politcal representatives have more influence in Europe as part of the UK. It simply is not true. Of course, the overall package may be worthwhile.
If independence comes both parts of the Former UK (great acronym don’t you think?) will have adjustments to make – most likely the loss of the EU rebates and an obligation to join the Schengen agreement.
As for Jim Sillars….he doubtless endorses the ‘yes’ campaign, but surely Canavan and Thompson are more important figures? It should be more of a concern that McLeish might join them. He is far better regarded in Scotland than most Labour observers realise.
Finally…there are plenty of former Labout voters that supprot the SNP on the basis of competent social-democratidc government but will not vore ‘yes’, but there is also a substantial portion of Labour, tory and Lib-Dem voters who would never vote for the SNP but will vote for independence. More signirfcantly lots of voters who were afraid of independence in the past are not afraid of it now, so if the choice of who runs your country is Cameron/Clegg/Milliband/Osborne/Balls on the one hand or Salmond/Swinney/Sturgeon/Robertson/Hosie on the other, how many people will be guided by that prospect when they go to vote?